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Technology Stocks : Newbridge Networks -- Ignore unavailable to you. Want to Upgrade?

To: Doug who wrote (8723)	12/24/1998 11:04:00 AM
From: Caxton Rhodes	Read Replies (1) \| Respond to of 18016

Canada's Newbridge builds war chest, eyes purchase By Lydia Zajc TORONTO, Dec 22 (Reuters) - Canadian telecommunications firm Newbridge Networks Corp. has socked away nearly C$1 billion in cash to boost client confidence and fund possible acquisitions, analysts said on Tuesday. The war chest has been built by selling off stakes in affiliate companies. Last week Newbridge sold its 30-percent holding in Vienna Systems, an Internet telephony firm, to telecom equipment maker Nokia for $90 million. Earlier in December it sold its 40-percent chunk of Cambrian Systems, a fiber-optics infrastructure maker. The buyer was Newbridge rival Northern Telecom Ltd. Once the money is added to the previous change in Newbridge's purse, the company will have nearly C$1 billion in cash, company spokesman Paul Goyette said. "We've got a pretty good war chest," he said. "One of the potential uses of the money that we've built up (is) for anacquisition." Analysts speculate on other reasons for building the money pile. They said it might serve as a confidence booster for major clients concerned about the long-term viability of Newbridge or to help customers with financing. Duncan Stewart, portfolio manager at Tera Capital, noted that Newbridge would not have enough money for a big takeover. They might make a deal, but "I'm not expecting it to be big or material," he said. Instead, Stewart said the money is there to instill confidence in its major equipment buyers. "They look at Newbridge with revenues of a couple billion and they say: 'Are you big enough? Do we know that you're going to be around and able to support us?' " he said. "It's the equivalent of walking into a high-stakes poker game and being able to meet the ante." Mark Lucey, managing director at Kearns Capital, disagreed. He noted that an acquisition, or a series of small takeovers, could be in the wind. "Clearly that's what they're trying to do here, or at least leading us to believe, is that this is a war chest, if you will, for the initiation of string-of-pearls typeacquisitions." Lucey said Newbridge might be willing to soften its formerly stringent focus on asynchronous transfer mode technology to look at small, private companies that are developing Internet based systems that can use the World WideWeb. Also, a large hoard gives Newbridge a chance to develop customer financing, to help clients while bank loans arearranged, he added. Larger rivals such as Northern Telecom do this and now Newbridge can as well. "Having a stronger balance sheet helps in that respect," Lucey said. Newbridge Networks shares on Tuesday rose C$0.60 to C$45.20 on Toronto's stock market. In New York the stock ticked $0.38higher to $29.19. ($1 = $1.55 Canadian) ((Lydia Zajc, Reuters Toronto Bureau (416) 941-8109, or e-mail lydia.zajc@reuters.com))

To: Doug who wrote (8723)	12/30/1998 8:12:00 PM
From: Doug	Read Replies (1) \| Respond to of 18016

IP6 (version 6) is supposed to redesign TCP/IP to support address encryption and Q of S using the RSVP protocol. All this will mean an improvement in latency stats which is currently a handicap vrs ATM. In short IP6 is expected to narrow the gap. As the expense of switching to ATM based switches and cards is quite large,I doubt that many firms will consider it cost effective. I think they will wait for IP to improve. Looking forward is the desktop technology going to be IP on Ethernet or ATM.? Thanks.